Painting with Numbers: Presenting Financials and Other Numbers So People Will Understand You

Praise for Painting with Numbers

"In today′s information age, the challenge facing public company executives to ensure their messages are heard by customers and investors has never been more poignant. Painting with Numbers lays out a practical guide to helping business leaders cut through all the noise and communicate crisply and clearly with the audiences that matter."
Duncan Niederauer, CEO, NYSE Euronext

"Randall′s book teaches what I have long believed a key objective of finance is to provide timely, accurate, and understandable information that leads to better decisions. This is a challenge for organizations of all sizes from very early–stage ventures to large public companies."
Eric Keller, Chief Operating Officer, Kleiner Perkins Caufield & Byers

"This is a book that badly needed to be written, so it′s about time! I hope that it′s read by not just financial people, but by entrepreneurs and C–suite executives as well. The book is both intellectually challenging and downright practical, and will shape the thinking of entrepreneurs and seasoned veterans who need to communicate numbers for business success."
Harry Kellogg, Vice Chairman, Silicon Valley Bank

"Government policymakers need to do a much better job of communicating clearly with data, especially when it comes to our increasingly alarming federal fiscal situation. Painting with Numbers can help them do just that. Not only do I wish this book had been around when I was Budget Director, but I′m now prepared to drop my claim that my brother was adopted."
Joshua Bolten, former White House Chief of Staff and Director, Office of Management and Budget

"I feel strongly that clearly and honestly presented data is essential to an informed electorate, and Randall made it possible for me to put that belief into practice. I′m delighted that a book like Painting with Numbers is available. I am confident that the lessons Randall Bolten sets forth in this book, a first of its kind, will have a hugely positive effect on the level of public debate and, thus, the quality of the choices we make in our public and private lives."
From the Foreword by Dr. Tom Campbell, Dean, Chapman University School of Law; former Dean, U.C. Berkeley Haas School of Business; five–term U.S. Congressman; Professor of Law, Stanford University; and PhD in economics (University of Chicago)

Foreword xiii

Preface xv

Acknowledgments xvii

introdUCtion This book Is Not About Numbers Honest! 1

Being Literate 2

It s What They Think That Matters 2

What You Were Never Taught 3

The Ultimate Goal 5

Some Notes about Reading This Book 5

Part I the rules 11

Chapter 1 Numerals Matter 13

Lining Up the Numbers 14

The Units of Measure 16

Precision 17

Negative Numbers: What Do They Mean? 20

Chapter 2 Looks Matter 25

The Tabula Rasa Decision 26

The Where s Waldo? Effect 27

White Space Is Your Friend 29

But White Space Is Not Always Your Friend 30

Time and Other Dimensions: Across or Down? 33

Borders, Shading, and Other Visual Effects 35

Comments and Artwork 41

The Ransom Note Effect 43

Two Truly Helpful Hints 44

Chapter 3 Words Matter 47

Mean What You Say and Say What You Mean 48

Choosing between Precision and Presentability 52

Treating Words Like Numbers  55

Remember the Title. Please 57

Chapter 4 Your Audience Matters   61

The Right Amount of Data   62

Appropriate Emphasis on Critical Information 64

Consistency  67

Meaningful and Relevant Numbers  69

Respect for Your Audience s Time  73

Wrap–Up for Part I: The Rules  77

Part II The Tools 81

Chapter 5 You Can Pay Me Now   83

The Instant Payoff Tips  85

Instant Payoff Tip #1: Set Up Templates and Styles  85

Instant Payoff Tip #2: Customize Your Toolbar  86

Instant Payoff Tip #3: Learn Some Shortcut Keys  87

Instant Payoff Tip #4: Use Consistent Formats  89

Instant Payoff Tip #5: Learn to Use Excel as a Database  90

Instant Payoff Tip #6: Learn to Use the Lookup & Reference Functions  94

Instant Payoff Tip #7: Organize Data for Easy Computation  95

Instant Payoff Tip #8: Learn to Use Automated Help  98

Instant Payoff Tip #9: Don t Learn Too Many Ways to Do the Same Thing  99

Chapter 6 . . . Or Pay Me Later 103

The Long–Term Payoff Tips  104

Long–Term Payoff Tip #1: Use Sensible, Intelligent Filenames and Folder Organization  104

Long–Term Payoff Tip #2: Use Consistent Formats 106

Long–Term Payoff Tip #3: Design Intelligent, Intelligible Formulas  106

Long–Term Payoff Tip #4: Use Named Ranges  110

Long–Term Payoff Tip #5: Use Named Formulas or Macros 112

Long–Term Payoff Tip #6: Links: A Force That Can Be Used for Good or Evil  117

Long–Term Payoff Tip #7: Make Different Types of Cells Visually Distinguishable and Physically Separate  118

Long–Term Payoff Tip #8: Document Your Work!  120

Long–Term Payoff Tip #9: Check Your Work!  121

Long–Term Payoff Tip #10: Avoid Cool New Features  122

Chapter 7 Graphs: The Cartoons of Numbers   125

Why Do People Use Graphs?  126

Help Your Audience 127

First, Do No Harm 138

Chapter 8 The Pitfalls of Presentations and PowerPoint

 153Why Do People Make Fun of Business Presentations?  154

Real Estate Is a Scarce and Precious Commodity  154

Help Your Audience  156

First, Do No Harm  161

Some Basic Truths That Go Double for Quantation  162

Wrap–Up for Part II: The Tools  166

Part III Real Mastery   169

Chapter 9 It s Clear, but Is It Meaningful?   171

The War of the Adjectives  171

A Quantation Professional  173

Relating to Your Audience in a Constructive Way  174

Chapter 10 53 . . . Uh, Is That a Lot?   179

What Is a Key Indicator?  180

What Makes a Good Key Indicator?   183

A Simple Example  185

How Do You Present Key Indicators Effectively?  185

A Note on Precision  190

A Note on Dashboards  191

Chapter 11 The One Report Every Organization Needs   197

A Sample Natural P&L, and What Makes It a Good One  199

1. One Page!  200

2. Decision–Focused Line Items  200

3. Appropriate Dollar Amounts, neither Too Big nor Too Small  204

4. Intuitive Organization of the Line Items 205

5. Understandable Categories, Meaningful to All Users  208

6. Plain–English Terminology  208

7. Consistent Look–and–Feel  209

8. Key Results Equal to the Corresponding Numbers in the Accounting System (or an Explanation Why Not)  209

Mapping the Chart of Accounts  211

Generate a Natural P&L from a Spreadsheet, or from the Accounting System? 212

Now Let s Talk about the Columns  213

Appendix 11A a Sermon to the Accounting Purists   219

Chapter 12 The Gaps in GAAP   225

Rules–Based versus Principles–Based  226

Where Is All This Headed?  227

Expensing Stock Options  228

Software Revenue Recognition  230

Tying GAAP to Internal Management Reports 232

Appendix 12A Some Notes on GAAP   235

What Is GAAP?  235

Stock Options  236

Revenue Recognition  237

Chapter 13 Quantation: It s Not Just for Business Anymore   239

One Taxpayer at a Time  240

All the Taxpayers at Once  243

What s Really Going on Here?   249

Chapter 14 Quantation in Ordinary Life   255

Models  255

The Meaning of Words  260

That Quiz I Promised  263

Part IV Wrap–Up   269

Chapter 15 Speaking Truth to Power   271

My Tell the Truth Syllogism  272

Reason #1 for Telling the Truth: It s the Right Thing to Do  272

Reason #2: It s in Your Employer s Interest  272

Reason #3: It s in Your Interest   273

Reason #4: You Will Get Caught  273

Reason #5: It s the Gotcha of This Book  275

Don t Be So Smug, You Civil Servants and Elected Officials!  276

Your Audience Has a Role, Too  276

Chapter 16 Now, What s the First Thing You Do?   281

My Last, Best Tip  282

It s Just a Skill  282

Where We Have Been  283

Appendix Jazz Meets Theology   287

Revisitation  288

The Sins of Presentation  289

The Sins of Behavior 297

The Deadliest Sin of All 301

About the Author 305

Index   307

RANDALL BOLTEN operates a consulting practice focused on financial management and information presentation. He is a seasoned and accomplished finance executive, with thirty years of experience in high–growth and high–potential Silicon Valley companies. His professional passion is presenting information that can enable managers, investors, and the general public to make real sense of complicated situations. He holds a Bachelor of Arts degree from Princeton University and an MBA from Stanford University.

Painting with Numbers does an excellent job of covering all the topics that go into effectively communicating with numbers. Bolten s style of writing is engaging, entertaining, and, most important, effective at delivering his message. This book hasn t only become a key reference on my bookshelf, but I also now have a comprehensive, textbook–style reference to use when I mentor others on communicating effectively with numbers." (Bill Boehman, CMA, CPA, Strategic Finance Magazine, January 2013)

"There actually are quite a lot of annoying things that accountants and analysts do with spreadsheets and PowerPoint presentations. By the time I finished the first section of the book, I had thought of five or six experienced accountants at clients or companies I am investigating to whom I would like to give this book." ( The Value Examiner, Sept/Oct 2012)

"If you′re doing investment pitches, you should read this book. If you′re doing a pitch I′m going to see, I want you to have read this book. And if you′re a startup CFO, finance lead, bean counter, or presentation slide deck preparer, then you should read this book." (Gust.com, June 2012)

"Do you want to tell a story with numbers? If so, I recommend you run, don′t walk, to buy this book." (Life Insurance Selling Magazine, June 2012)

Praise for Painting with Numbers

FROM REVIEWS:

"I highly recommend the very accessible and process based book Painting with Numbers: Presenting Financials and Other Numbers So People Will Understand You by Randall Bolten, to anyone in business, public policy making, analysis, science, or any occupation or profession who works with numbers and must present that data to an audience. This book will improve your numeric and overall presentation skills, boost your career, and create a more successful business."
Wayne Hurlbert, Blog Business World

"Painting with Numbers: Presenting Financials and Other Numbers So People Will Understand You [is] a book that will help you overcome the stigma of presenting numbers and allow you to give more effective presentations involving numbers.... For those in the financial world, Bolten′s book is perfect if you′re looking to give more successful presentations. It′s as simple as that. You will be doing yourself and your career a huge favor."
David Domzalski, FinancialBin.com

"Painting with Numbers, by Randall Bolten [is] the best book I′ve seen on how to present numbers with skill. Randall was a CFO for twenty years in Silicon Valley, so he′s got the benefit of seeing all the various ways, shapes, and sizes that people throw numbers around.  He′s exactly the right person to learn from when it comes to seeing through the numbers, knowing what they mean, and knowing how to present them more effectively to speak the truth, and to make better decisions ... in work and in life.

It′s a book I′m going to recommend to the people I mentor to help them advance their careers and take their game to the next level."
J.D. Meier, MSDN Blogs

FROM SPEAKING ENGAGEMENTS:

"I′ve seen Randy Bolten′s presentation about his book, Painting with Numbers(Wiley 2012) twice. Randy focuses on communicating numerical data. As a former CFO in the semiconductor industry, he has faced many a room full of high–level executives, and he has seen many a financial presentation –– some clear, many not so clear. His precepts are down–to–earth tips that anyone can learn to use. Simple, but not trivial. They fit into the half–hour between generating the numbers and publishing the report."
Richard Mateosian, STC Fellow (Society for Technical Communication)

"Randall′s relaxed and personable presentation style made it easy to connect with the audience. He brought the definition of "quantation" to life with useful examples of how we, as professional communicators, can more clearly present financial information. I′ve seen enough bad presentations in my career to know that this information will be helpful to many."
David Gennarelli, Director, Investor Relations, Autodesk, Inc., and President, SF chapter of NIRI (National Investor Relations Institute)

"Great presentation! Randall is an engaging and hugely knowledgeable speaker, who gave us a much–needed wake–up call about the importance of mastering financial communication. Not only was it useful, but thanks to Randall′s humor and warmth, everyone enjoyed the ride. I highly recommend him!"
Rikke Jorgensen, VP Programs & Professional Development, International Association of Business Communicators, San Francisco chapter